Toshiba's president Hisao Tanaka, two others resign over accounting scandal

21 July 2015

Toshiba Corp president Hisao Tanaka and two other executives have resigned taking responsibility for the $1.2-billion accounting scandal that caused the company to restate earnings for more than six years.

Norio Sasaki, the vice chairman, and Atsutoshi Nishida, a former president who was serving as adviser, also resigned, according to the Tokyo-based company today, over two months after announcing it was probing accounting irregularities.

The company said earlier in the day it would correct earnings by at least ¥152 billion, on the basis of results of a third-party investigation of its books.

''For the company to rebuild there needs to be a renewal of the management structure,'' Tanaka, a 42-year veteran, said during a briefing today in which he, chairman Masashi Muromachi and vice president Keizo Maeda all bowed in apology.

Muromachi would take over as interim president, and the company would announce a management team in mid-August. No charges had been filed against Toshiba or its executives in the case.

The resignations follow a report that said top executives set unrealistic profit targets that systematically led to flawed accounting. The investigation found that accounting irregularities were ''skillfully'' hidden from outside observers.

Toshiba's businesses presence spans a wide range of sectors from home electronics to nuclear power stations.

"It has been revealed that there has been inappropriate accounting going on for a long time, and we deeply apologise for causing this serious trouble for shareholders and other stakeholders," the company said in a statement.

Tanaka told a media conference that "we have a serious responsibility", adding that the company would need to "build a new structure'' to reform itself.

Toshiba had been faced with competition from Korean and Chinese firms.

Tanaka, 64, and Sasaki, 66, both joined Toshiba in the early 1970s and Sasaki was Toshiba president during June 2009 and June 2013, which covered most of the period during with the firm inflated profits.

Atsutoshi Nishida, an adviser and former chief executive from 2006 to 2009, also quit his post.

People expressed their anger at the scandal on social media.

According to one Twitter user, "It's appalling how long this cover up could have carried on", while another said, "clean out the entire company! Toshiba needs to carry on its legacy properly."